Andy Burnham, who is set to become Prime Minister on Monday after replacing Sir Keir Starmer as Labour leader, has signalled a new policy for pubs across England. The former Greater Manchester Mayor has pledged to cut business rates for pubs and other small hospitality businesses by 20% starting next year, as part of a broader pro-business agenda.
Business Rate Cuts and Threshold Increases
Burnham stated that the government has “got it wrong on small businesses” and intends to make his administration more supportive of them. In addition to the 20% rate cut, he plans to raise the threshold at which small businesses begin paying business rates, which has been frozen at £12,000 since April 2017. He also aims to abolish the tax entirely for cafés, shops, and hairdressers.
Reversal of Employer National Insurance Increase
Burnham has suggested he could reverse the increase in employer national insurance contributions, which rose from 13.8% to 15% in April 2025. “I have said that I thought the weight of the burden of employers’ national insurance wasn’t the right decision,” Burnham said.
Reactions from Analysts
Sarah Coles, from Hargreaves Lansdown, commented: “Businesses have been feeling the squeeze from recent policy changes, so the prospect of some of that easing will be really positive for those who are struggling.” She noted that Burnham is considered “soft left,” which could benefit lower-income individuals but raise concerns for wealthier people about potential tax increases to fund the support.
Coles added: “For those people in the middle, the big question is going to be where that line is drawn, and when they might start facing higher taxes.”
